Nikita Singla

Consultant . International Affairs. Sciences Po Paris. Engineer. IIT Delhi. Solo Backpacker. Yoga Trainer

Connecting North-East India to South-East Asia

Despite globalization being the buzzword of the last three decades at least, it is becoming increasingly evident that some regions of the world are still not integrated into the world economy.  While we are seeing 21st century as Asian century, this lack of integration is holding back, two of the most dynamic regions – South Asia and South-East Asia. Huge potential of economic integration between the two sub-regions calls for the need to better connect South and South-East Asia, which could help in rebalancing Asian growth in this century. With Myanmar as the bridge between the two sub-regions and North-East India as a potential vantage entry point for South-East Asian markets, deep diving into India Myanmar trade seems like an onus on the economies of both these regions.

Since 1991, South Asia, particularly India has adopted a ‘Look East’ policy and opened its market raising huge potential for economic integration between South and Southeast Asia leading to peace, prosperity and stability of these two regions. However, little seems to have moved in comparison to the potential. The North East Region (NER) of India possesses boundless natural resource endowment, sharing almost 98% of its land border with Bangladesh, Bhutan, Nepal, China and Myanmar. And by virtue of its strategic location, Myanmar is key to India’s ‘Look East Policy’ through NER. Most of the trade between India and Myanmar happens through one border check post in Manipur even though the North East shares a 1600 km-long border with Myanmar. Besides, large volumes of informal trade takes place through local trade points which don’t even get recorded. The underlying factors for the inability of the two sub-regions to undertake initiatives towards enhancing cross-border trade and hence, market consolidation need to be probed.

While India is looking at its neighborhood to boost intra-regional trade and get the economy back in shape, it cannot be missing out on Myanmar. Indo-Myanmar cross-border trade is facing a plethora of problems towards trade infrastructure, trade barriers, policy making and limited regional integration. Although memorandums of understanding have been signed between India and Myanmar to enhance border development and increase connectivity between the two countries, much remains to be done at the trade-border points. At present, four Land Customs Stations are in operation through which trade with Myanmar can take place: Avangkhu (Nagaland), Moreh (Manipur), Zokhawthar (Mizoram) and Nampong (Arunachal Pradesh). It is required to undertake a detailed examination and evaluation of the four LCSs trading with Myanmar to identify the existing bottlenecks that make cross-border trading, such a costly affair. Understanding if the LCSs are well equipped to handle the increase in trade traffic as a result of free trade agreements coming into force is imperative.

While looking at the prospect of Indo-Myanmar border trade route developing into major trade corridor between India and South-East Asia, it is vital to gauge the perception of traders and look into procedural problems they face. The importance of increasing border trade is immense for it will lead to greater economic openness. This will be manifested by increased trade flows, greater intra-regional migration, access to new markets, all presenting a potential for rising standards of living and greater development in both NER and Myanmar.

 

 

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This entry was posted on April 5, 2014 by in Writings on international affairs and economics.

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